Binary options trading is one of the trending platforms in the investment or financial industry. And it’s likely going to keep growing as I don’t see it going extinct in the nearest future. With this little article, I am going to introduce you to the world of Binary options trading.
What is binary option?
According to Wikipedia,
A binary option is financial option in which the payoff is either some fixed monetary amount or nothing at all. The two main types of binary options are the cash-or-nothing binary option and the asset-or-nothing binary option [https://en.wikipedia.org/wiki/Binary_option].
Is Binary options trading legitimate?
There have been arguments about Binary options trading, whether it is legitimate or not. Even the government at first didn’t know where to classify it. Some say it’s betting, others say it’s trading (investing). Well, here is the thing, it is absolutely legitimate, but risky. It is risky because if you lose, you’ll lose all the money invested. Let me also bring this to your knowledge, it is not a get rich quick scheme.
How does Binary options trading work?
In a nutshell, Binary options trading is all about prediction. The traders are required to predict whether the value of assets such as gold or any other type of financial asset will decrease or increase in a certain time frame (period of time).
Take yourself as a Binary trader. If you predict that the value of gold will increase in a set time frame, if the value increases as predicted, you’ll win and earn a commission, but if it doesn’t you’ll lose all the money invested to lock in your prediction. That’s how Binary options trading works. As a Binary options trader, you need to consistently follow up the trends in stock, real estates and other various financial assets in marketplaces in order for you to consistently be able to predict accurately.
Let’s compare Binary options trading to sports betting
Following the above explanation, you’ll observe that Binary is more like sports betting than official or real trading. Now, what is the difference between sports betting and Binary? The only difference is the assets or objects being betted on. In binary, traders bet on financial assets, but in sports, people bet on teams. Apart from that, I see no difference.
Is it safe to trade Binary options?
Hell yeah! Binary options trading is a legitimate business. Most Binary options brokers are legitimate businesses. So, apart from you losing, your money will be 100% safe.
The brokers and deceit
One common way brokers lure new traders is through case studies. They’ll show them how people managed to rake in tons of hundreds or probably thousands of dollars with little investment. Don’t get fooled by these case studies. Don’t get me wrong, I’m not saying they’re not true. See it this way, the way sports betters luckily rake in tons of dollars is the same way skilled and lucky binary options traders hit their figures. You should know that sports betters only win occasionally. Even the ones who have been in the system for long, they don’t win often.
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So, don’t fall for those unrealistic promises from some desperate brokers. The brokers won’t tell you what you truly need to do in order for you to win. They expect you to invest randomly, because whether you win or lose they’ll still make money. A lot of newbies fail to understand this.
Can I make reasonable amount of money through Binary options trading?
Of course, you can. Previously, in order for you to hit good figures, you have be dedicated and make a lot of research. But recently things have changed. With the introduction of some new automated technologies by the brokers, you can make money from Binary options trading without much stress.
In order for you to be able to win consistently, you have to understand how the system works and invest your time and effort to do a lot of research. And even if you do understand the system very well, and invest your time and effort in doing research, sometimes you’ll still need an atom of luck to be able to win.
Take sports as an example again. In order for a sports better to be able to win, he needs to understand the game, the ability of the teams and the skills of the players. Also, he needs to be knowledgeable about their past performances and other necessary information about the team he wants to bet on. After gathering this information, he’ll have enough courage to go ahead and bet on whichever team thinks would win. But then, he’ll still be skeptical about the whole thing. This is quite similar to what Binary options traders go through.
To accurately predict the future possible development of an asset, you have to be well informed and stay up to date about recent happenings, political developments, state of an economy, current business news and other financial events. Also, you need to be able to decipher a variety of technical data: charts, statistic calculations etc.
This sounds like a really difficult task
Well, it used to be. Previously, in order for you to be a successful Binary options trader – You need to invest your energy and time to learn about the technical aspect, and do a lot of market research. Don’t get me wrong, I’m not saying that today you don’t have to go through any stress to win. What I’m saying is that the stress has reduced a notch unlike previously.
Once again, don’t go investing your money randomly hoping you’ll win. And that’s exactly what the brokers expect you to be doing. Remember, the more you invest, the more money they make. And whether you lose or win, the brokers will still make money.
Apart from the brokers trying to convince you to invest even when they know you might not win, there is nothing wrong with this system of online trading. But I don’t like to regard it as an investment.
Once again, Binary options trading is not a scam. Although it’s somewhat like gambling/betting just like I explained above, but it is 100% legitimate.
It takes a well learned person who follows up trends in financial markets to be able to hit the big figures in Binary options trading. In other words, it takes devotion and knowledge to be able to succeed in the Binary options trading system.
The new changes in Binary options Trading That have made trading easy
There is still no shortcut to making cool money with Binary options trading. Just like I explain above, in order to be successful in this trade system, you need to learn the basics and do a lot of research. Although, there have been new developments that have made things easy. Through the help of these automated system technologies, you can easily make reasonable amount of money or even earn a living through Binary options trading.
- Social trading is now one of the major ways people trade Binary options. If you’re a newbie and you don’t want to go through the technical or learning process, then you can still make good money by using seasoned veterans. Most brokers will give you the privilege of using social trading platforms. This will help you gain from the trading experiences of the most successful Binary options traders in that company. Don’t forget, your money is at stake, so, when choosing your signal provider, choose wisely.
- Today, there is Binary options robots too, which makes auto recommendations for users. However, most of these robots are scams. So, unless your brokers offer you their own automated profitable trading services, it is better you avoid them.
Even if your brokers offer you their own automated profitable trading tool, don’t put too much hope in it. Like seriously, why would they give you a tool to win their money, are they Santa? LOL. It is better you do your research and find out if using the automated system is worth it. And in case you finally decide to make use of an independent Binary options trading robots, beware of scammers!
Other tools you should know about
- Today, it’s quite easy to have access to necessary financial information you need to make a wise trading decision. Premium Binary options brokers can provide you with great platforms that provide information for technical analyses of the assets you tend to trade. These platforms will help you to make better trades without much stress.
- In most cases too, brokers introduce robots that search financial newswires to find the latest events in order for you to be able to rightful anticipate market variations. These new automated trading systems now make Binary options trading quite easy, unlike before.
Should I go ahead and trade Binary options?
Yes, like I mentioned earlier, it is completely legit. But as a beginner, you’re going to jump through some hoops before you can start making a reasonable amount of money from the system.
I believe with this small article you have understood how Binary options trading works. All you need to succeed is better information and technical analyses. And you can only get these things if you’re dedicated. Apart from these things, you also need to be very careful when you trade, in order for your money not enter into the wrong hands.
The best way to learn how the system works is through trials. The more experience you get, the better you’ll understand the system, the better you understand the system, the better you’ll become.